Used Car Pricing: The Insanity Of Used Car Prices!

Used car prices are elusive, despite numerous attempts to harness them. We’ve all heard of Retail, Private Party and Trade-in values. But do these “help” in determining a vehicle’s real value? When we turn to the web for prices, it gets even more elusive. One web site places a retail value on a car at $18,000. Another puts it at $21,000. What should we believe?

If sellers are looking to get the highest price for the car they’re selling, and the buyer wants to get the best deal possible, is there such thing as a fair used car price for both parties?

The answer is yes, but both parties have to be on the same page.

We’ll call this “page” Fair Market Value.

That being said, how do we interpret the market to determine fair market value? Since most sellers and buyers are going to try to interpret the market to his or her advantage, let’s even the playing field.

One of the most profound remarks I’ve heard to establish a better playing field for used car pricing comes from industry expert and owner of Medway Imports, Barry Roth. He states:

“To find market value, you need to take all the pricing data you find for a particular vehicle and throw out the high and low prices. What’s left in the middle is where you’ll find a fair market value.”

While this doesn’t address the used car pricing problem entirely, it does remove the unrealistic numbers that many clutch to like the drowning to a life preserver. It moves folks to more reasonable prices according to the market.

A lot of time is spent on popular web sites (for better or worse) to “help” determine used car pricing. But one should also follow and watch the market to see what cars are being advertised and sold for-if they’re being sold at all.
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